Case Study 7

The situation

Each couple has 2 children and is separated. Each parent earns the same (£200 per week) and always has one child every night.

The only difference is: Mack & Mabel swap children every Friday evening. Jack & Jill keep the same child with them. (Jack has their son, Jill has their daughter). Their costs are identical.

Where there isn't a clear parent with care for a child, the mother claims Child Benefit, as usual.

Mack & Mabel

Mack & Mabel swap children every Friday evening.

Jack & Jill

Jack & Jill keep the same child with them. (Jack has their son, Jill has their daughter).

Comparison

Every parent has exactly the same care of children and exactly the same cost.

Where Jack & Jill retains a child permanently, they are financially equal (as they should be). The White Paper says "Where parents have separated and one or more of their children live with each parent, both parents are non-resident parents - and both are parents with care. In his situation, we will assess the maintenance liability of each parent. Only the difference in liabilities will be payable." An excellent attitude.

But where Mack & Mabel attempt to share each child exactly equally, the bizarre White Paper equal-sharing formula steps in. The result is that fathers like Mack who try to share their children equally might find themselves £40 per week worse off than mothers like Mabel.

Why doesn't the White Paper use exactly the same logic that it applied where children were permanently living with particular parents? (This question ignores the probability that the answer is "it was an accident and we couldn't be bothered to fix it!")

First, because of the bias in the benefits system which awards Child Benefit to the mother by default. Second, because of the truly weird feature of the White Paper that insists that even where parents share the care of a child exactly equally, one of them must be the parent with care and the other must be the nonresident parent, even if everything is exactly equal. (Why?) This results in the unjustified £8 child support.

There is no logical difference between the Jack & Jill case and the Mack & Mabel case. Every parent earns the same, every parent cares for his or her children the same, and each parent spends exactly the same on their children during direct care. So why don't they all end up the same? Because the White Paper shared-care proposal is ridiculous! And the benefits scheme leaves a lot to be desired.

The Fair Shares formula balances out the child support for Mack & Mabel just as for Jack & Jill. There becomes no net liability. (Only the benefit anomaly remains).

This is an HTML transcription of an article written in September 1999, hence the benefits rates, the references to the White Paper, etc.